The Federal Housing Administration (FHA) will decrease insurance rates for affordable and energy-efficient housing to encourage increased development of such communities. The rates, which will go into effect April 1, 2016, should help rehabilitate 12,000 more apartment homes each year.
The FHA will also reduce upfront insurance rates to 25 basis points for FHA loans on broadly affordable (90 percent of which are under Section 8 contracts and/or qualify for low-income housing tax credits) and energy-efficient apartment communities. Rates for mixed-income properties will drop as well to 35 basis points.
By reducing our rates, [the FHA] is taking a significant step to encourage the preservation and development of affordable and energy efficient housing in communities large and small, said Department of Housing and Urban Development Secretary Julian Castro in a press call. This way, hard-working families wont have to make the false choice between quality or affordable housing.